Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages. Just because a business is in the green today doesn’t mean it will thrive tomorrow.
A business making money today isn’t necessarily a winner, which is why we analyze companies across multiple dimensions at StockStory. That said, here are two profitable companies that leverage their financial strength to beat the competition and one that may struggle to keep up.
One Stock to Sell:
onsemi (ON)
Trailing 12-Month GAAP Operating Margin: 10.8%
Spun out of Motorola in 1999 and built through a series of acquisitions, onsemi (NASDAQ:ON) is a global provider of analog chips specializing in autos, industrial applications, and power management in cloud data centers.
Why Are We Bearish on ON?
- Customers postponed purchases of its products and services this cycle as its revenue declined by 10.8% annually over the last two years
- Gross margin of 38.2% is below its competitors, leaving less money to invest in areas like marketing and R&D
- Expenses have increased as a percentage of revenue over the last five years as its operating margin fell by 16.9 percentage points
At $76.15 per share, onsemi trades at 18.1x forward P/E. Check out our free in-depth research report to learn more about why ON doesn’t pass our bar.
Two Stocks to Watch:
Belden (BDC)
Trailing 12-Month GAAP Operating Margin: 11.9%
With its enamel-coated copper wire used in WWI for the Allied forces, Belden (NYSE:BDC) designs, manufactures, and sells electronic components to various industries.
Why Do We Like BDC?
- Impressive 11.2% annual revenue growth over the last two years indicates it’s winning market share this cycle
- Exciting sales outlook for the upcoming 12 months calls for 34.6% growth, an acceleration from its two-year trend
- Performance over the past two years was turbocharged by share buybacks, which enabled its earnings per share to grow faster than its revenue
Belden is trading at $123.63 per share, or 12.4x forward P/E. Is now the right time to buy? Find out in our full research report, it’s free.
Visa (V)
Trailing 12-Month GAAP Operating Margin: 60.7%
Processing over 829 million transactions daily and connecting billions of cards to 150 million merchant locations worldwide, Visa (NYSE:V) operates one of the world's largest electronic payments networks, facilitating secure money movement across more than 200 countries through its VisaNet processing platform.
Why Should You Buy V?
- 14.5% annual revenue growth over the last five years surpassed the sector average as its products resonated with customers
- Share buybacks propelled its annual earnings per share growth to 18.8%, which outperformed its revenue gains over the last five years
- Stellar return on equity showcases management’s ability to surface highly profitable business ventures
Visa’s stock price of $370.59 implies a valuation ratio of 25.4x forward P/E. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.
High-Quality Stocks for All Market Conditions
WHILE YOU’RE HERE: Top 9 Market-Beating Stocks. The best stocks don’t just beat the market once. They do it again. And again. Robust revenue growth, rising free cash flow, returns on capital that leave their competition in the dust. The market has already rewarded these businesses.
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Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.